Citi launches RMB cross-border pooling venture

It's outside the Shanghai Free Trade Zone.

Citibank (China) Co., Ltd. (“Citi China”) has announced that it has signed an agreement with one of the world’s leading consumer goods companies, to execute RMB cross-border pooling.

According to a release from Citi, this marks the full implementation of this milestone structure at a nationwide level, and also one of the first RMB cross-border pooling solutions outside the Shanghai Free Trade Zone (“SFTZ”).

This fully automatic pooling structure customized for the Fortune 500 Company leverages Citi’s global technology platform and capitalizes on successful experiences that Citi has gained through its pilot solutions in SFTZ.

Building on the client’s treasury management structures in China and abroad, this solution allows the company to execute cross-border RMB sweeping by connecting its onshore and offshore structures together, resulting in greater efficiency in process and treasury management.

Yigen Pei, Citi China’s Treasury and Trade Solutions Head, said, "We are delighted to be among the first banks to provide such advanced RMB cross-border liquidity management solutions to our clients.

The expansion of RMB cross-border solutions to a nationwide level not only signifies SFTZ’s positioning as a test-bed for further financial reform, but also brings profound influence to the process of RMB internationalization.”

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Alan Lin, Citi Treasury and Trade Solutions Head for Greater China added, “This move further strengthens Citi’s leading position in liquidity and treasury management. Multinational companies make up an important part of Citi’s client base.

With the increase in cross-border trade, we will continue to leverage Citi’s advanced global platform and extensive local experience to bring more world-class treasury management products and services to our clients and help them achieve their business goals.”

Sandip Patil, Regional Head for Liquidity Management and Investments, Citi Asia Pacific, commented, “The RMB’s role as a world currency, not only for international trade but as a treasury, capital and reserve currency is becoming more strategic.

There is tremendous potential for multinational companies to benefit from increasing deregulation of the RMB and the implementation of nationwide cross-border solutions. This move will deepen liquidity pools in and outside of China, ease the way business is conducted and ultimately lead to business growth.”

Citi has been at the forefront of facilitating the RMB internationalization process and launched a series of pioneering and market-leading treasury solutions, including the first two-way auto sweeping RMB pooling, the first RMB cross-border payment and receivables on-behalf-of (POBO/ROBO) structure, and the world’s first RMB netting structure in SFTZ, all for leading pharmaceutical company Roche, in China.

Citi was also the first bank to launch automated RMB cross-border sweeping from China to London for Swiss-based company Pentair.